The closure of Jimmy Lai Chee-ying's online retail business adMart and ezVan shows that Hong Kong shoppers are not ready to shop on the Internet.
The announcement last Monday resulted in 344 members of staff losing their jobs.
adMart chief executive Anton van Gorp said the company's failure to lure shoppers on to the Internet was the main reason behind the decision to close.
'The cost of home deliveries was not fully covered,' he said. Mr van Gorp said when they started the aim was to attract as many customers as possible away from traditional to online shopping.
Douglas Brown, marketing director of Wellcome, a major adMart rival, said adMart's business strategy was wrong.
People in Hong Kong liked to go to stores to look around, he said. Mr Brown said adMart offered grocery products cheaply, hoping to attract buyers to other more profitable products such as electronic appliances.